Like decent human beings

Like decent human beings

I was in France recently, for work mostly rather than pleasure. I’ve had to speak more French in these few days than I’ve done for decades, and it’s been gratifying to feel that once surrounded by the everyday words and grammar, and forced to use it, my decayed knowledge of the language should revive itself.

All the same I still have to tune in, to focus hard on what’s being said, and in this respect, for much of the time, this week has offered some of the pleasure that any trip to a foreign country presents, the relaxation of being away from an environment where you’re sensitive to every social or culturally-inflected nuance.

This general calm envelops you, helping you switch off and enjoy yourself. It’s a calm that can also hold off the intrusions of the commercial world, which in reality are as omnipresent in France as anywhere else. I can read French well enough and know what all the signs and ads mean, but it seems so much easier to screen them out, knowing they are for the most part aimed at homegrown consumers.

Then again in France there are still many more small independent enterprises (or so it seems), and a good deal less uniformity in the town centres. The big chains are still there of course, but their impact is leavened by more individual shop fronts. (It’s a different story on the outskirts of town where the French were the European pioneers of US style mega-retail sites.)

Consistency v uniformity

I’d guess the big retail chains would argue that this obliterative uniformity in town centres is important to their brand recognition, or indeed that some people find comfort in it: you know what you’re going to get when you go into Starbucks or Costa. But I wonder (as ever) whether they’re confusing uniformity with consistency, and whether there’s now an opportunity for a more nuanced relationship between businesses and their customers.

Just to take a small example, I use Costa coffee shops quite a lot, because the coffee is reasonable, the seats comfortable, and I know I can pick up the wifi. These are all good consistencies. The uniformity of the decor is a little dispiriting, though I understand why it might be cheaper for the business. But why force the staff to wear uniforms? Why not just give them aprons (branded if necessary) and otherwise let them retain their individuality? After all these are social places, and in my local branch I’m on first name terms with many of them. That individuality can easily co-exist with the consistency you do want to preserve. Perhaps it’s time to stop trying to draw everything into the machine.

Then again it may be time for a much more profound redefinition of the place of business in society.

Rethinking corporate purpose

In the last five years or so management thinking has been pushing the importance of corporate purpose, of what business is for. The idea probably has its roots in the older notion of corporate social responsibility (CSR), but what’s most striking about it is how it sits at odds with what has become the ascendant dogma of shareholder capitalism, that the real driving force for business decisions has been the need to make large amounts of money to feed the short term demands of the financial community.

I’m not suggesting it’s wrong for businesses to want to make money. Indeed I think it’s important that they do so. Businesses are always going to be the primary engine for the redistribution of the wealth they create, through the salaries and the taxes they pay. I’d argue that in the last thirty years, and particularly the last ten, they have become dysfunctional in this respect, because the supremacy of the shareholder-led model has been diverting disproportionate amounts of money into the financial community, which is then unable or unwilling to deploy that accumulated capital to create further useful value for society. This in a nutshell is why the current phenomenon of “inequality” is so important and so dangerous.

The idea of “corporate purpose” can’t be treated on the same footing as other management concepts like brand or Total Quality Management, because it demands a circle of assent between business managers and the social or cultural views in which they must operate. It’s not just another tool to engage better employee motivation and raise productivity, though it might well do those things. It’s part of an evolution away from what has proved a destructive business model.

I’m not underestimating the difficulties here. Although there are many business leaders who already recognise that there’s a problem, getting the financial sector to change its expectations and its habits is going to be tough. It can only happen through a combination of primary legislation, fiscal manipulation (to reward long term investment) and a public debate which creates pressure for change. It will be a tough sell because it means those in the financial sector will have to accept smaller (if still rich) rewards, as will senior management. Before objectors start talking about global marketplaces and the demand for “top talent” it also needs to be said that at the moment it’s a rigged market, and that the escalation of reward is higher in the UK even than the US. It’s become a structural problem for our economy, and it has to be addressed.

Getting it right

But there are some immediate rewards for businesses that can get it right. Getting it right means thinking about corporate purpose differently. It’s not about bolting on some kind of overarching social good, to take the place of shareholder primacy; for many businesses it may be impossible to link a social good to its products, and in any case unless that social purpose is real (which means it could never be compromised for the sake of earnings) it’s always going to be vulnerable to accusations that it’s no more than a PR stunt.

But it should be possible (and necessary) for every business to think more coherently and accurately about its place in society, and what this means for its “stakeholder” relationships.

In a sense this isn’t new. It’s what CSR was supposed to be about, and indeed what the notion of “stakeholder” was supposed to push forward. But CSR was treated largely as a function, not a way of being, and that was always likely in an era where the need to meet short-term shareholder demands has been the dominant truth of corporate purpose.

What is new is a shift in consumer views of business, a cynicism and anxiety brought on by the more rapacious version of capitalism that’s come into being. It’s a cynicism that makes all the things businesses want to say about their values and commitments sound hollow. To address this cynicism I’d suggest businesses don’t need to reach for some distinctive “corporate purpose”. They need to start behaving like decent human beings.

And that’s an interesting idea.

Being human

It’s an idea with radical implications for the ways businesses talk to their customers, and to themselves (to their staff). Apart from anything else it means being unafraid of letting the real humanity in your business speak for itself (or actually, themselves). So if as is likely your business is currently exploring the tricky territory of social media, you need to let the people doing it be themselves, let them speak for themselves in their conversations (the clue is in that word “social”). That doesn’t mean they should be discussing their personal politics, but it takes us back to the coffee shop, to the important distinction between consistency and uniformity. If people speak (or write) like corporate robots, slaves to the tone-of-voice fascism of routine brand thinking, the conversation will not go far because in a social context we don’t really like talking to robots. Your representatives need to understand what it is about the business that matters, about its corporate story and its priorities, but they need to be able to tell that story in their own, human words.

It means when it comes to a town centre presence, whether in France or anywhere else, a little more modesty might be called for, because that’s an attractive human trait, and could make people warm to your business rather than seeing it as an unreflective marketing machine. So while you might reasonably want to offer instantly recognisable signage, you might do so in a way that shows greater care for, greater attention to whatever else might be going on around. The local authority in Stratford upon Avon has long imposed this constraint on businesses in its historic centre, and I doubt it’s led to any diminishing of brand recognition.

The idea of being human goes beyond the way businesses speak, or present themselves. It’s about how they think, about their aspirations, about how they expect staff to feel about their work, and how those staff themselves relate what they do at work to the values that govern the rest of their lives (one might say it’s about pulling down the artificial division between the spheres of work and everything else). Given that conceptual, behavioural shift, more effective, engaging communication should follow.

So in this sense it’s not a communications issue at all. It’s about engaging with reality.

We are at an important moment of change. As I write the UK is about to go to the polls in a general election. It’s been one of the most unengaging campaigns I can remember, at a time when the choices that need to be made could hardly matter more.

It’s been unengaging because politicians, ever behind the curve, still believe that what you say doesn’t particularly have to connect to reality, that you can win by spin, by constructing your own reality. In recent years, partly because of the internet, partly because of events, this idea which started in business has begun to unravel. In business, politics, and every other aspect of our lives, we need to reconnect what we want and do with who we really are (as humans). Then we might stand a chance of having other humans help us along the way.

Corporate purpose and identity

Corporate purpose and identity

It’s usually important that the senior managers of a business think hard about the purpose of the business, and its values, and they need some ready means of keeping these things in mind. It’s usually helpful too if all staff have some sense of this corporate purpose, and their roles in bringing it to reality. But normal practice goes much further, aspiring to create a machine-like uniformity in the culture of the organisation, an aspiration to ensure that it is “on brand” (as determined by the mission and values) in every possible way.

There are many problems with this aspiration, not least that it’s as unnecessary as it is unrealistic. Large organisations will have many cultures, and their interaction is likely to be an important part of what makes that organisation work. There may be aspects of those cultures that could be usefully changed, but these things need to be individually and thoughtfully addressed: throwing the usual vacuous brand vision/mission/values at them is very unlikely to make a difference, and more likely to be counter-productive.

A widespread problem is that the notion of brand identity is all too easily a fiction, an act of wishful thinking by the management. It’s particularly ironic because brand people tend to talk earnestly about brand essence, when they are rarely dealing with anything remotely essential. Brand positioning is too often driven by some kind of market insight, reflecting how managers want the business to be perceived by its customers, rather than anything very real about what makes the business work. This is almost certainly why brand visions are rarely visionary, and the missions and values which are supposed to make the organisation distinctive do the opposite (they are all much the same, full of vapid aspiration rather than anything rooted or even meant).

Conceived this way brand becomes little more than another communication campaign (while unhelpfully pretending to be something deeper), a core slogan to be thrown at the market, accompanied by the dangerous demand that your employees make it real by learning to “live the brand”.

Generally, being human we will struggle to relate to an abstraction such as a business or organisation, and so look for some version of personality in that organisation with which we can have something like a normal social interaction, and which will seem meaningful. Ideas (which are all that get offered by the “messages” crafted by professional communicators) can help express personality over time, but only if they have a deep consistency, reflecting a real identity. Brand people in contrast seem to think that you can replicate this deep consistency through superficial uniformity. But if uniformity is all you have, fictional identities will be undermined because the organisation will almost certainly go “off brand” in the other things it needs to say about itself.

A belief-driven business will have a real version of personality, a real consistency, a projection of the individuals actually engaged in that enterprise.

On some level brand people understand this. It’s why they talk about getting employees to live the brand. But a brand-driven concept of employee communication will defeat the underlying purpose: by pushing an overweening (and usually false) notion of brand personality you negate the possibility of any real personality coming through, and with it lose the possibility of personal engagement or involvement (we are being asked as employees to put our personalities aside, but our real personalities are important both to ourselves and the enterprise, because only real personalities at any level are sustainably engaging).

Corporate identity and brand identity exist in different spaces, and we have different purposes in thinking about each of them. With brand we’re trying to understand what it is about a product that makes people buy it. That may or may not include corporate elements over and above the product’s features and performance, and it’s in those elements that corporate and brand identity meet. But think of this as a Venn diagram: there’s an area of overlap, but it’s not even a particularly large one. 

Corporate identity on the other hand is what the organisation is. Understanding it demands insight into the cultural elements that make the organisation work, including elements likely to attract prospective employees. Corporate identity might well contribute to your products’ attractiveness (particularly through the activities often grouped together as Corporate Social Responsibility) but it is necessarily bigger and more complex than brand.

Forcing brand thinking on corporate identity deforms that identity, damaging its ability to function in ways that it really needs to function. In particular, by pushing for brand uniformity, we’re still thinking in machine rather than human terms.

Purpose and diversity

It is probably, self-evidently helpful if employees understand whatever the core purpose of the organisation might be and are helped to work in a way that supports that purpose. I’ve seen this ambition described as ensuring they are all facing in the same direction, but even this much is a misconception. Most jobs (at least 80 per cent of them) are not mechanical and simple, but are collaborative, involve problem solving and interaction. Value is created not in some core of the enterprise, but in these interactions with people outside the enterprise. The directional metaphor is seriously unhelpful in this reality: we need people to move in circles, to go down different avenues and explore new possibilities and open up new ways of getting to that acknowledged corporate goal.

But the babble routinely talked about brand, about mission and values, and what have you, can only suppress this movement (it is designed to do so), or at least create a pressure that interferes with our own intuitions about what we could and should be doing. We need better ways of influencing people to work in support of the corporate purpose (which probably means we need better ways of understanding corporate purpose).

And yet huge amounts of effort (and quite a lot of money) are expended in pursuit of these dubious goals. It’s as if we’ve switched off our normal critical faculties, the ways in which we normally attend to the world and the people around us.

And perhaps that’s more or less what’s happened. We’ve switched off our broader critical faculties in order to attend to a narrower, more analytic idea of what people do, how they work in groups, how they are influenced. This is characteristic of our left brain view of the world, arguably part of the Zeitgeist, a retreat in the face of the complex and difficult. But it’s a retreat to a fantasy world, and we need to get out more. We need to start using the whole of our brain, to make room for intuition as well as pseudo-scientific measurement, and accept that this isn’t a soft option, but one less likely to waste our time and money, or worse be counter-productive.

We need better ways of thinking about identity, better tools for handling it. If we want to work with intuitive levels of meaning, we need tools or ideas that can solicit and develop intuitive apprehensions of meaning, rather than the blunt instruments of the standard brand toolkit. These ideas will help with external communication, and they are indispensable for internal communication.

Minds, machines and business models (2)

Minds, machines and business models (2)

Since the industrial age, the machine has been the model for business (explicitly in the work of the late 19th century management theorist Frederick Winslow Taylor, whose thinking, though hardly fashionable or explicitly embraced, still dominates management ideas).

That’s probably because efficiency is directly correlated with profit, and making a business work like a machine seemed a good way of lowering costs and achieving consistent output.

The machines of the industrial age were large, mechanical, their processes sequential. Bryan Appleyard notes the significance of Babbage’s Difference Engine (a computational device) as the first machine with an abstract rather than tangible output, heralding a new and very different machine age, the one in which we’re now living. But coming from the first machine age we constructed organisations around the idea that managers should have as much control as possible, the scope for deviation written out of the program.

The very best, obvious way to achieve this was to replace human work with machines. This has duly happened, with ever more sophisticated robots in recent years eliminating the need for human labour even in tasks that once called for more advanced human skills. We’ve put machines into places that we’d reasonably expect to be about human interaction, whether in the ATMs that took over many common banking activities, or the automated call answering systems that pretend to be a first level of customer responsiveness.

Control and creativity

Machines bring their own management tasks: they have to be maintained, and upgraded in line with technology advances. But they do simplify, reducing the possible variables between management intention and output to the market (which itself is only okay if you see your relationship with the market as essentially one-way). This simplicity became all the more attractive in a world that was rapidly becoming more complex, as communications technology made globalisation possible. Businesses themselves had evolved into more complex structures, expanding their product ranges, their geographical reach, and the sophistication of their support functions, from human resources through logistics to marketing.

For a while this evolution seemed the most obvious means for managers to keep control of all the different elements that the business required, but as the functional complexity multiplied management theorists (and practitioners) began to talk of “core competencies”. A different model quickly emerged, in which managers define their requirements, and then contract out to specialist suppliers to meet those requirements. On the face of it this model multiplies profit centres in the supply chain, and so would push costs up. In reality it rests on the assumption that specialist operators will be better at identifying and removing cost in their operations without compromising quality. Crucially it allows managers to shorten lines of accountability, restoring a sense of control in an ever more challenging world.

But this desire for control is only part of the story. In the last twenty years we have found ourselves moving into a different kind of machine age, driven by information technology (if the importance of the Difference Engine is that it’s the first machine with an abstract output, we’re only just beginning to experience how transformational this could be). This shift away from the mechanical demands a rethink of the machine model for those who remain in the workplace.

Machines are generally a poor source of competitive advantage. Early adopters of new technology may gain a useful early lead, but others will soon catch up (machines are relatively easy to replicate). This probably explains why in the last fifteen years or so management theory has put an increasing premium on creativity on business. What really defines a business is its culture (not what it makes). It seemed that at some level we no longer wanted the organisation to work like a machine, but to have a culture in which people could be spontaneous, where they routinely thought “out of the box”, a culture that was entrepreneurial and nurtured innovation and responsiveness.

The left brain world view doesn’t yield this ground easily.  Managers have sometimes tried to make this kind of human creativity machine-like, following the idea that “knowledge management” could be an IT function. The American consultant and writer Don Tapscott sums up the folly of this (and suggests a necessary alternative).

“Knowledge management has failed. We had this view that knowledge is a finite asset, it’s inside the boundaries of companies, and you manage it by containerizing it.

“So, if we can get all of Jessica’s knowledge into this container, or computer system, then when she leaves the company we’ll still have Jessica, or we can get to Jessica in this container. And this was, of course, illusory, because knowledge is an infinite resource. The most important knowledge is not inside the boundaries of a company. You don’t achieve it through containerization, you achieve it through collaboration.”

(in an interview with McKinsey Quarterly January 2013)

It’s true that Tapscott is still thinking about technology (he is urging businesses to investigate and adopt social media), but that’s because he understands that technology can help us do human things more effectively, rather than working as a mechanised substitute for those activities (which are valuable exactly because they are unpredictable).

The crucial point here, and one which has attracted surprisingly little comment, is that there is a big contradiction between this ambition to foster creativity, and the prevailing, fundamental assumptions about the machine-like things managers should be doing to make a business run effectively. Something has to give. The problem is also evident in the ways we have come to think about brand, a problem I will be exploring in subsequent pieces.